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Yu Group sees sales 'substantially' ahead of forecasts
Gas and electricity supplier Yü Group said sales and profits would be ahead of current market forecasts, even despite increased investment in the business, and that 2018 and 2019 would also be "substantially ahead" of previous expectations.
Revenues for the calendar year will be "significantly ahead" of expectations with directors confident that the decision to investment in further staff and fixed costs via a new office in central Leicester will still see operating profits ahead of target.
The AIM-listed group had net cash of £5m at the period end, some of which is used to for hedging against energy price changes, with cash generation in the second half of the year hit by payment of certain industry levies, which was expected.
Looking forward, contracted revenues for 2018 have jumped to more than £50m, up from the £23.2m Yü had booked in September and the £20m from 2016.
The company, which floated on London's AIM in early 2016, said its main business opportunity is coming from the medium sized corporate sector, though small businesses and larger corporates still provide valued customers.
"Our success in this middle market leads us once again to increase our expectations for growth in 2018 and thereafter. As such we anticipate that revenues for 2018 and 2019 will be substantially ahead of our previous expectations."
Chief executive Bobby Kalar said: "The business is developing well and our focus on our long term sales growth is paying dividends."
Shares in Yu, having already risen almost 150% over the course of 2017, climbed another 9% on Monday to 1,121.6p.
"The business is young and therefore sensitive to any increase in fixed costs, but management appears to be managing this well," said analyst Neil Wilson at ETX Capital.